Wednesday, August 5, 2009

A reality check from across the pond

Housing Bottom? No, The Mother Of All Head Fakes

This article is related to the US housing market. However, it is certainly pertinent to what's happening in the UK. The writer's second case on the issue of mixes is interesting and ought to be born in mind. He talks about a "temporary seasonal change in the mix of houses sold--with 'organic sales' (normal, voluntary, free-market sales) becoming a larger percentage of the overall sales than they were in the winter, when distressed/foreclosure sales dominated...The organic sales market picks up each summer...But the season ends now. Every year, organic sales fall off of a cliff beginning in August primarily because kids go back to school in Sept...Never before in the history of the housing market have we had two markets pulling and pushing on each other like this."

Posted by wanderinman @ 11:47 AM (848 views)
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3 thoughts on “A reality check from across the pond

  • It’s not the bottom. It’s actually the elbow. Not that a lot of people would be able to spot the difference.

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  • Old_traveller says:

    I really wish it could be applicable here but there are two things against the relevance of that article in the UK:

    1- AFAIK the Haliwide indeces correct for house mix therefore rendering baseless any argument suggesting that since more expensives houses are the only ones selling ATM then average prices ought to increase.
    2- Haliwide indeces do not include repossesion transactions so the mix issues higlighted in the article do not apply either.

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  • @Another_pleb

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